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Subdued cues from Asian peers & double whammy of macroeconomic data may sour mood of market participants

Karan DSIJ
·2-min read

On Tuesday, it will be a rare sight for the market participants to witness the Indian markets open in red as the domestic markets rallied for the eighth consecutive session on Monday.

SGX Nifty is trading down by 36 points at 11,931 levels. This is mainly due to the subdued cues from the Asian peers and the double whammy of macroeconomic data. The inflation and IIP data, which was released after the market hours on Monday, is likely to sour the mood of the market participants as the consumer price index-based inflation for September came in at an eight-month high on the back of the rising food price, while India’s Industrial Production fell 8 per cent in August.

Security in the F&O ban for today is Adani Enterprises, BHEL, Canara Bank, IDEA, Jindal Steel, and SAIL.

The majority of the Asian markets were trading in red on Tuesday. China’s Shanghai Composite was down by 0.48 per cent while Japan’s Nikkei slipped 0.15 per cent.

Like a coin has two sides, Indian markets too witnessed two shades on Monday. The first half was a memorable one as Nifty reclaimed its important psychological level of 12,000 and Sensex traded above the 40,800 mark. However, the second half was a bit painful as the key indices turned volatile, mainly because, the measures announced by the Finance Minister failed to enthuse market participants and they preferred to take profits off the table. As a result, markets trimmed their gains and closed with minuscule gain. Nifty and Sensex added 0.14 per cent and 0.21 per cent. ITC, the heartthrob of value investor Camp, jumped just over two and a half per cent after CLSA upgrades the stock. The broader indices continued with their dismal performance as Nifty Mid-cap and Small-cap dropped 0.58 per cent and 0.37 per cent, respectively. Most of the sectoral indices ended in red wherein, Nifty Media and Nifty PSU Bank were the top losers and on the other hand, Nifty IT and Nifty Pharma became the top gainers.

The US stocks kicked off the week in style as it extended its recent rally. The tech-heavy Nasdaq led from the front as it surged 2.6 per cent to 11,876. Technology stocks were seen buzzing as the stock of Apple jumped 6 per, while Facebook and Google also joined the party on Wall Street. Dow and S&P added 0.9 per cent and 1.6 per cent, respectively.

Meanwhile, the majority of the European indices also ended in green; however, the market participants were in a cautious mood as the rising Coronavirus cases weighed on the sentiments further, in order to tackle the rising cases. Italy is preparing fresh nationwide restrictions and the UK Prime Minister Boris Johnson is likely to make a statement to the House of Commons about additional curbs.